99 STAT. 1522

PUBLIC LAW 99-198—DEC. 23,1985

Loans.
Banks and
banking.

98 Stat. 138.

Corporations.

Corporations.

Prohibition.

7 USC 1961 note.

"(e) Notwithstanding any other provision of this title, the Sec-
retary shall reserve not more than 10 percent of any loan made
under this subtitle or $5,000 of such loan, whichever is less, to be
placed in a nonsupervised bank account which may be used at the
discretion of the borrower for necessary family living needs or
purposes not inconsistent with previously agreed upon farming or
ranching plans. If the borrower exhausts this reserve, the Secretary
may review and adjust the farm plan with the borrower and con-
sider rescheduling the loan, extending additional credit, the use of
income proceeds to pay necessary farm and home and other ex-
penses, or additional available loan servicing.".

ELIGIBILITY FOR EMERGENCY LOANS

SEC. 1308. (a) Section 321(a) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1961(a)) is amended by—

(1) inserting after "United States" in clause (1) of the first
sentence "and who are owner-operators (in the case of loans for
a purpose under subtitle A) or operators (in the case of loans for
a purpose under subtitle B) of not larger than family farms";

(2) in clause (2) of the first sentence, striking out "farm
cooperatives or private domestic corporations or partnerships in
which a majority interest is held by members, stockholders, or
partners who are citizens of the United States if the coopera-
tive, corporation, or partnership is engaged primarily in farm-
ing, ranching, or aquaculture," and inserting in lieu thereof the
following: "farm cooperatives, private domestic corporations,
partnerships, or joint operations (A) that are engaged primarily
in farming, ranching, or aquaculture, and (B) in which a major-
ity interest is held by individuals who are citizens of the United
States and who are owner-operators (in the case of loans for a
purpose under subtitle A) or operators (in the case of loans for a
purpose under subtitle B) of not larger than family farms (or in
the case of such cooperatives, corporations, partnerships, or
joint operations in which a majority interest is held by individ-
uals who are related by blood or marriage, as defined by the
Secretary, such individuals must be either owners or operators
of not larger than a family farm and at least one such individ-
ual must be an operator of not larger than a family farm),"; and

(3) inserting after the first sentence the following: "In addi-
tion to the foregoing requirements of this subsection, in the case
of farm cooperatives, private domestic corporations, partner-
ships, and joint operations, the family farm requirement of the
preceding sentence shall apply as well to all farms in which the
entity has an ownership and operator interest (in the case of
loans for a purpose under subtitle A) or an operator interest (in
the case of loans for a purpose under subtitle B).".

(bXD Subsection (b) of section 321 of the Consolidated Farm and
Rural Development Act (7 U.S.C. 1961(b)) is amended to read as
follows:

"(b) An applicant shall be ineligible for financial assistance under
this subtitle for crop losses if crop insurance was available to the
applicant for such crop losses under the Federal Crop Insurance Act
(7 U.S.C. 1501 etseq.).".

(2) The amendment made by paragraph (1) shall not apply to a
person whose eligibility for an emergency loan is the result of